Visa and Mastercard have reached a revised settlement with U.S. merchants over long-running claims that the card networks impose excessive “swipe” (interchange) fees, according to a November 10, 2025 letter filed in Brooklyn federal court. While the initial filing signaled agreement in principle, subsequent reporting indicates the new proposal would trim interchange fees by about 0.1 percentage point from levels that typically range between 2% and 2.5%, and apply the reduction for five years. The deal aims to end a two-decade dispute over how much retailers pay when customers use credit cards at checkout.
Under the proposed framework, merchants would gain greater discretion over card acceptance, including the ability to decline specific card categories, while still accepting others on the same network. That change would loosen the so-called “honor-all-cards” restrictions that have been central to merchant complaints about rising costs and limited bargaining power. Any agreement remains subject to court approval, and the precise mechanics will be scrutinized as parties brief the court.
Background: Earlier $30 Billion Deal Was Rejected
The revised proposal follows a major setback for the networks and some merchant groups in June 2024, when U.S. District Judge Margo Brodie said she was unlikely to grant final approval to a roughly $30 billion settlement that would have capped and cut certain fees, leading the court to deny preliminary approval. That development sent parties back to the negotiating table to address concerns about the duration and scope of relief, merchant opt-out rights, and the enforceability of promised changes to network rules.
The current litigation is part of a wider thicket of cases over card fees and acceptance rules. In 2019, the networks agreed to a separate $5.54 billion cash settlement resolving damages claims over past fee-setting practices, and in October 2025 they agreed to $199.5 million to settle a class action tied to chargeback liability rules for chip-card adoption. Those matters are distinct from the present rule-change settlement, which focuses on forward-looking network conduct and fee levels rather than compensating for prior alleged overcharges.
What Changes for Merchants and Consumers
If approved, the new deal would lower interchange rates by ~0.1 percentage point for five years, offering a predictable glide path for retailers’ card-acceptance costs. Because interchange is embedded in the merchant discount rate paid on each transaction, even small adjustments can translate into material savings at scale. Some analyses and media accounts suggest the settlement could also ease network rules that constrain price signaling and expand merchants’ ability to steer customers toward lower-cost payment options, including through revised surcharge and discount practices. The details on steering and category-level acceptance will be central to how much real leverage merchants gain in day-to-day operations.
For consumers, the impact is two-sided. On one hand, merchants and some economists argue that lower interchange can reduce retail prices over time as costs decline. On the other hand, a shift away from mandatory acceptance of high-reward cards paired with slightly lower fee revenue could pressure card rewards programs, a trade-off consumer advocates and issuers have debated for years. Early coverage of the renewed talks has highlighted this tension, noting that retailers favor lower fees while cardholders value cash-back and points funded in part by interchange.
Outlook: Court Scrutiny and Industry Pushback
The revised settlement will face close judicial review and active input from merchant coalitions and payments industry groups. Critics have previously argued that incremental fee cuts and time-limited caps do not structurally reform how interchange is set, which they say behaves like collective price-setting by networks and issuing banks. The Merchants Payments Coalition has already signaled skepticism toward earlier iterations of a deal that, in its view, did “nothing to change” the underlying pricing model. Expect opponents to assess whether the new terms meaningfully alter acceptance rules, network governance, and merchants’ ability to negotiate.
From the networks’ perspective, securing a comprehensive settlement could reduce legal uncertainty and standardize rules after years of piecemeal litigation. Investors and analysts will watch whether the five-year reduction is large enough to be felt in merchant economics yet small enough to be absorbed by issuers without a significant pullback in cardholder incentives. Media reports indicate the fee cut is designed to balance these interests while addressing the court’s concerns about the durability and enforceability of relief. Further filings are expected to detail implementation, compliance monitoring, and merchant opt-out pathways, which were contentious points in prior proposals
If the court grants preliminary approval, the case would move into class notification and objection phases, a process that can take months. In parallel, policymakers could revisit legislative or regulatory options around card fees and routing competition. Regardless of the final contours, the filing marks a notable step in attempting to resolve one of the longest-running and most economically significant antitrust battles in U.S. retail payments.
